ProBiotix Health was plunged into a leadership crisis on Wednesday after one of the life sciences firm’s biggest shareholders called for the resignation of its CEO.
Seneca Partners, which controls a 5.5% stake in the Aquis-listed business, has requisitioned a general meeting of the company’s shareholders including a vote to remove CEO Steen Andersen from the board along with a non-executive director connected to a major investor.
The board of ProBiotix has rebuffed the proposals, blasting them as “hugely disruptive” and adding they “would not only damage customer relationships but prove a disproportionately costly and wholly unnecessary exercise.”
“The proposed resolutions are not in the best interests of the company and come at a critical time when ProBiotix is gaining commercial traction and is at an inflexion point in its growth trajectory,” ProBiotix said, adding Andersen “has carried out his role with professionalism and has never had grounds hitherto for any disciplinary procedure to take place.”
Seneca Partners, an SME investor based near Liverpool, has also proposed a motion that would in effect prohibit the ProBiotix board from making any future director appointments. UKTN has contacted Seneca for comment.
It comes after ProBiotix, which in June warned it was running out of cash, approached shareholders for a fresh capital injection but were rejected, including by Seneca.
The firm subsequently approached Danish entrepreneur Frederik Bruhn-Petersen and was able to secure a new share subscription of £1.2m. The investment was made on condition that Frederik Bruhn-Petersen’s son, Frederik Bruhn-Petersen, would gain a seat on the company’s board as a non-exec director, a move which Seneca has now contested.
“Given its previous unsuccessful attempt to raise money, the board felt that by having a supportive shareholder with a long term focus it would enable the company to be fully funded,” ProBiotix said.
“To place his son, Frederik Bruhn-Petersen on the Board as a non-executive director was felt to be a reasonable request in light of the significant investment in ProBiotix.”
ProBiotix Health shares were unchanged in early trading.